City firms show caution over rushing into liberalised Indian market…
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UK firms are firming up their plans for entering the Indian market after Indian law minister Hans Raj Bhardwaj's announcement that the country's legal market is to open.
As first revealed on www.the lawyer.com (25 September), Bhardwaj said India will allow foreign firms to establish offices offering only foreign law capabilities, although a timetable for when this will happen is yet to be finalised.
Magic circle firms said they are keen to enter the market, although they are waiting for concrete details on how and when they will be able to do so.
Clifford Chance India practice head Chris Wyman said: "There'll now be pressure on all major firms to find a business-sensible way to be in India."
Wyman added that, while Clifford Chance is not interested in setting up a representative office in the nation, the firm had been looking very seriously at going into India. "Our clients say there's a need for us to be there," he added.
Freshfields Bruckhaus Deringer also said it is not interested in setting up a representative office in India. The firm's India head Pratap Amin said the firm would need to learn more details about the proposed opening of the market before making any definite decisions.
"We haven't really worked out if there's a demand for offering foreign law services in India," he said, adding that demand for foreign law practices in the country peaked in the 1990s.
Linklaters Asia managing partner Giles White said the firm has had an affiliation with Mumbai firm Talwar Thakore & Associates since last December and has no plans to change this strategy at present.
"The move [by Bhardwaj] was something we anticipated for a while, which is why we don't need to change our tack as the building blocks are already set in place," he said. "We'd like to be in the country when it becomes a possibility."
Allen & Overy head of India Alex Pease, who is a member of the Joint Economic and Trade Committee (Jetco), was not available for comment, but A&O underscored its commitment to the nation by agreeing to a tie-up with Bangalore University in May (www.the lawyer.com, 3 May).
Outside the magic circle other firms are preparing their strategies in anticipation of entering the Indian market.
Herbert Smith India group head Chris Parsons said: "Obviously we'll want to have a presence in India. We have a large number of Indian clients and we can now be more accessible to them."
Similarly, Berwin Leighton Paisner (BLP) head of India Mark Lewis said his firm is also considering a move.
"Setting up in India is something we're seriously looking into now," he said. "We've been looking into it for a while."
Ashurst India group senior consultant Ian Scott, who is also a member of Jetco, told The Lawyer that, as the firm already had the infrastructure in place, it would practise in India once the details of the liberalisation are released.
Despite this, all firms maintain that they will not act on their plans until a detailed announcement outlining the proposed structures and any restrictions that may be placed on foreign firms has been released.
Meanwhile, in India Bhardwaj is still trying to appease local law firms in relation to the announcement. He is offering safeguards to local firms and is also looking to set up a regulatory committee to monitor the entrances and operations of foreign firms as an incentive for their agreement on the move.
"I have to convince one million lawyers in the country for such a proposal," said Bhardwaj.
The safeguards are expected to encompass measures to "level the playing field" for both Indian and foreign firms. Under current regulations Indian law firms are not allowed to advertise or have more than 20 partners in an equity partnership.
Current legislation falls under India's Advocates Act 1961, which states that only advocates enrolled in India are entitled to practise law in India. This was the act that scuppered attempts made by Ashurst Chadbourne & Parke and White & Case to crack the Indian market in the mid-1990s.